Subscribe

November 2015

Tim O'Reilly(O'Reilly Media) opened last week's conference on the Next:Economy, aka the WTF economy, noting that "WTF" can signal wonder, dismay or disgust. I experienced all three reactions at different times during the ensuing two-day "investigation into the potential of emerging technologies to remake our world for the better". I attended the conference because I have long been interested in the nature and meaning of work, and now that I work for Indeed, I am particularly interested in how we can remake our world by reimagining how the world works for the better.

The conference presentations and discussions, curated by Tim and his co-organizers Steven Levy(Backchannel) and Lauren Smiley(Medium), provided many interesting insights, experiences and provocations. If I had to choose three top themes that emerged for me, they would be

Augmentation vs. automation: technology designed to assist human workers by taking over some of their tasks vs. technology designed replacing human workers by taking over all of their tasks

The disintermediation of creative work: the vast array of tools and resources available for creative people to pursue their (our?) passions while earning a sustainable income outside of the constraints of a traditional job or company

Small is beautiful: the growing number of platforms for designing and creating products and/or offering services at small scales that can enrich the lives of the producers, consumers and society at large

I'm sharing - and shortening - my conference notes here, as I tend to understand and remember what I learn better when I re-process them for potential public consumption. I've also compiled a Twitter list including all the Next:Economy speakers I could find. Kevin Marks compiled and shared a much more extensive collection of notes from day 1 and day 2 of the conference, and a Pinboard storify offers an alternative perspective.

No ordinary disruption

James Manyika (McKinsey Global Institute) shared so many interesting facts, figures and forecasts that I had a hard time keeping up. The following are among the nuggets I was able to capture:

The consuming class (those who live above the subsistence level) will rise from 23% of the population to 50% in 2025

The last 50 years of year-over-year 3.5% average global GDP growth were fueled by the combined growth of labor (1.7%) and productivity (1.8%); with labor supply expected to peak in 2050, productivity growth will have to increase 80% to maintain overall growth rates

Labor markets don't work very well, producing massive shortages of workers with the right skills in the right places; digital platforms for helping increasing the quality of matches and decreasing job search times may help improve labor markets as labor supply declines

If all countries were to improve gender parity to level achieved by their "best in region" neighbors, we could add as much as $12 trillion (11%) to annual 2025 GDP

45% of tasks could be automated, but only 5% of jobs can be completely automated; up to 30% of tasks in 60% of jobs could be automated, redefining occupations and skills needed

We need to change our mindset from jobs to work, and from wages to income

From self-driving cars to retraining humans

Sebastian Thrun (Co-Founder and CEO, Udacity) offered an interesting perspective on human learning vs. machine learning: when a person makes a mistake (e.g., causes an automobile accident), that person learns, but no one else learns; when a robot (e.g., a self-driving car) makes a mistake, all other robots can learn. He said Udacity's strategy is to develop nano-courses and nano-degrees in response to industry demand for specific skills, to help more people get unstuck more quickly. He also recommends that everyone become an Uber driver for a day.

The future of personal assistants

Alexandre Lebrun (Head, Wit.ai, Facebook)said that Facebook's M personal assistant is designed to interact with customers as far as it can go, and then observe human customer service representatives ("trainers") when they intervene so it can learn how to handle new situations. Adam Cheyer (Co-founder and VP of Engineering, Viv Labs) talked about exponential programming in which an application can write code to extend itself; in the case of the Viv personal assistant, when you make a request, Viv writes a custom program at that moment to respond to that request.

Will robots augment us or rule us?

John Markoff (Journalist, New York Times) identified two divergent trajectories that emerged at Stanford around 1962: John McCarthy's lab focused on autonomous systems (Artificial Intelligence or AI) while Doug Englebart's lab focused on augmenting human intelligence (Human Computer Interaction or HCI), and noted that system designers have a choice: design people into the system or design people out. Jerry Kaplan (Visiting Lecturer, and Fellow at The Stanford Center for Legal Informatics, Stanford University) said the oft-cited [especially at this conference] 2013 Oxford study on the future of employment, which warned that 47% of total US employment is at risk of being automated was intellectually interesting but critically flawed; his view is that tasks will continue to be automated - as they have for 200 years - but not jobs, except for jobs whose tasks can all be automated (consistent with James Manyika's earlier forecast).

"Knowledge Work": No longer safe from automation

Kristian Hammond (Chief Scientist, Narrative Science) began with a bold claim about Quill, his company's software that uses templates to automatically construct narratives (text) to explain structured data: "If your data and their analysis have meaning, Quill can transform that into language". Since one might characterize everything in the world that humans attend to as some mix of data and analysis, I'm not sure exactly what that claims means, but I do understand - and like - his more modest claim that Quill specializes in small audiences ("writing for one"). I was also impressed with some of the examples of pilot projects he gave, including narrativizations of MasterCard's narrativization of targeted recommendations for small business owners, a portfolio fund manager's quarterly report (which typically takes a month to produce) and web site performance reporting. Echoing the theme of augmenting human intelligence that pervaded many presentations, he proposed that "If anyone has the word 'analyst' in their job title, something like Quill is going to be working with them at some point". And ending on yet another provocative note, he observed that "we need data scientists everywhere, but they don't scale" and suggested "'data scientist' is the sexiest job of the 21st century; it's the next job we're going to automate".

The Kickstarter economy

Yancey Strickler(Co-Founder & CEO, Kickstarter) presented some examples of how his crowd funding site has redefined hardware design as an artful medium, facilitating small-scale manufacturing of product lines with 150-5000 units and enabling creative people to be more independent and move easily from product to product. He also articulated three guiding principles for the WTF economy:

DON"T SELL OUT (but still survive); creative people often feel guilty charging money for work they do, but they need to earn enough to support themselves and their families

IT'S HARDER, BUT IT'S EASIER: it's harder to measure success without an exclusive focus on financial profits, but it's easier to make decisions based on more human-centered principles

The small scale factory of the future

Limor Fried(hacker, slacker, code cracker, Adafruit Industries) gave the most engaging remote presentation I've ever witnessed from her 80-person, $40M open-source hardware company's factory in New York. She articulated a particularly pithy description of Adafruit, which has produced nearly 900 tutorials -"we're an education company, with a gift shop at the end" - and offered an endearing story of a 6-year-old girl who regularly watches the Adafruit "Ask an Engineer" show, which features so many women engineers that the girl asked "Daddy, are there any men engineers?"

One, two, three, boom!

Mark Hatch(CEO, TechShop) launched into his presentation by informing us "I love revolutions" such as the one that was ignited when "the middle class got access to the tools of the industrial revolution", and "I'm a former Green Beret, and I love blowing things up". He proceeded to give us a whirlwind tour of his multifaceted response to the question "Has anything serious come out of the maker movement?", inviting the audience to share his enthusiasm for each example of a product - and lifestyle business - created bymembers of his TechShop hackerspaces by shouting "Boom!". The examples included an electric motorcycle, a jet pack, a desktop diamond manufacturing device, a laser-cutting cupcake topper, an underwater robot, as well as more well-known companies that started as a TechShop project such as Square, Solum and DripTech (the latter 2 being among the 5 top agricultural startups of 2014).

Real R&D is hard

Saul Griffith (CEO, Otherlab) shared highlights from two seminal 1945 essays by Vannevar Bush: As We May Think, which presaged the Internet, speech recognition and online knowledge sources (among other things) and the lesser-known report, Science, the Endless Frontier, which effectively transformed and transitioned research from small labs to large universities. With Google''s R&D budget of $9B now rivaling the combined funding of the National Science Foundation ($6B) and the Defense Advanced Research Project Agency (DARPA, $3B), we are in the midst of a transition of research from universities toward industry. Smaller scale industry research labs, such as Otherlab) have produced innovations that include drones used for wind power generation, inexpensive and durable trackers for solar panels, cheap actuators that can be used on a [slow] walking inflatable elephant robot, pneubotic (air-filled / air-powered) robots that can lift their own weight and minimize risks that their heavier counterparts pose to human collaborators, and soft exoskeletons that can enable anyone to run faster with less energy.

Why services aren't enough

Jeff Immelt(Chairman and CEO, General Electric) noted that industrial productivity growth has been declining from 4% (2006-2011) to 1% (2011-2015), but that reframing industrial products as data platforms (e.g., a locomotive today is a rolling data center with 600+ sensors) may open up opportunities for new products and productivity gains.

Workplace monitoring, algorithmic scheduling, and the quest for a fair workweek

Esther Kaplan (Editor, The Investigative Fund) chaired a panel discussion about what it is like to live (and work) in the reality of "the hyper-lean, electronically scheduled labor force", focusing primarily on retail jobs, which make up 10% of all US jobs.

Darrion Sjoquist (Starbucks barista, Working Washington) shared stories of growing up with a mother who worked for Starbucks, in which the entire family and was adversely affected by the unpredictability arising from 5-day advance schedule notices and clopenings (a closing shift followed by an opening shift the next day), making it difficult to commit to clubs or other extra-curricular school activities, as well as stories from his own experience as a Starbucks barista, in which co-workers and customers are at risk from sick employees doing their best to operate in a work regimen that is so lean that they cannot afford to take sick days.

Charles DeWitt (Vice President, Business Development, Kronos) said that Walmart ushered in an era in which labor became "a big bucket of cost and compliance issues", and people became an asset to be optimized. Schedule stability was not factored into workforce management software, but it could be. Citing the annual Gallup Employment Engagement Survey, and Gallup's estimate that disengaged employees cost the US $450-550B in lost productivity each year, he proposed that linking scheduling practices to employee engagement metrics may be a good way to promote greater stability.

Does on demand require independent contractors?

Leah Busque (Founder, TaskRabbit) framed TaskRabbit as service networking vs. social networking, which now includes 30K taskers (people who perform tasks for pay) in 21 cities, who make an average of $35/hour and $900/month across all locations, with 10% of taskers working full-time (via TaskRabbit). The service was first launched in Boston in 2008, where the large population of students was expected to provide plenty of candidate taskers; instead, early taskers tended to be stay-at-home moms, retired people and young professionals. Leah noted that "any business with a platform with 2 sides of a market has to make both sides successful" ... however, she did not recommend that everyone sign up to become a tasker for a day.

What's it like to drive for Uber or Lyft?

Eric Barajas (Driver, Uber), Jon Kessler (Driver, Lyft, former cab driver) and Kelly Dessaint (Driver, National Veterans Cab, former Uber and Lyft driver) provided a lively exchange of insights and experiences regarding the costs and benefits for driving for different companies. I don't know whether they would want their income shared publicly (outside the conference), but it appeared that Kelly, the cab driver, is faring better than the others in terms of higher revenue (due, in part, to larger and more frequent tips) and lower expenses (a daily gate fee of $111-121). Uber and Lyft drivers are responsible for gas, vehicle maintenance and insurance (Uber and Lyft only cover insurance only while drivers have paying passengers in the vehicle), and, in some cases, a lease; they face the perpetual prospect of being "deactivated" due to a customer complaint, and so have relatively little autonomy once they pick up a passenger. Kelly noted that taxi drivers are a community - "we look at each other, we nod" - and warned "the worst drivers in SF are tourists" and "most Uber/Lyft drivers are tourists" (because they live outside the city); he offered an interesting counter-perspective to what I've heard from the relatively few cab drivers I've traveled with recently.

The changing nature of work

Esko Kilpi (Managing Director, Esko Kilpi Company) observed that "People are not clever, people have never been clever, and people will never be clever" and so we create and use technology to compensate. He argued that the work systems we have are broken, because they are based on artificial scarcity and "wrong ideas about who human beings are", failing to take into account different situations with different demands. While work has always been about solving problems; it used to be that your boss told you the problem you were supposed to solve, but increasingly, defining the problem is itself part of the work, and so work and learning are inextricably linked. I highly recommend his recent Medium post on The New Kernel of On-Demand Work.

Just because the customer model is appealing doesn't mean the business model will work

A lot of platforms that call themselves marketplaces are actually managed services

Well intermediated marketplaces feel like a service

Regulation is a historical artifact, attempting to project the past into the present / future

Silicon Valley is the QA department for the rest of the world

Supporting workers in the on-demand economy

Nick Grossman(General Manager, Union Square Ventures) presented his views on the deconstruction of the firm, or "the jobs of a job": brand, income, customers, taxes and administration, benefits and insurance, facilities and equipment, scheduling, community, training. More and more of these elements can be found outside of traditional companies, enabling Individual workers to become, in effect, networked micro-firms.

Creating better teams

Stewart Butterfield(Co-founder and CEO, Slack) shared his view on the evolution of objects around which computer applications are based: applications, documents and (now) relationships. Slack has 1.7M users, including 1M paid subscribers, and for 3+ years was produced unselfconsciously as a tool to support lateral transparency while the team worked on what they thought would be their primary product (a game), until the tool itself emerged as a useful product in its own right.

Tax and accounting tools for the franchise of one

Brad Smith(President and CEO, Intuit) talked about the difficulties of quantifying "self-employment" because the term can be defined in so many ways. 78% of US Intuit users who are self-employed have 3 or more sources of income. He sees the recent extension of myRA (my Retirement Account) eligibility from small- to medium-sized businesses (SMBs) to self-employed people as a more positive step than most of the other reviews I've read.

Flexibility needed: Not just for on-demand workers

Anne-Marie Slaughter(President and CEO, New America) noted that "having a job that allows you to support your family is an essential ingredient in a personal life narrative" and that supporting your family means more than earning income: workers need the flexibility to care for family members. In discussing generous parental leave policies announced recently by some firms, she argued that you have to change the culture, not just the policy, and so extended parental leave won't matter much unless the men in senior leadership positions take advantage of the new policies.

Conference dinner

There were two separate talks presented by Code for America fellows: one has avoided signing a rental lease or owning a home through serial AirBnB stays in each place he's worked for a number of years now; another went on food stamps in his effort to better understand the challenges faced by food stamp recipients in California. Unfortunately, I did not take notes during either talk, and now cannot even remember the names of the presenters.

"Trickle-down economics is an intimidation tactic masquerading as an economic theory" [my favorite sound bite from the conference]

Managing talent in the networked age

Reid Hoffman(Co-Founder & Executive Chairman, LinkedIn; Partner, Greylock Partners) and Zoë Baird(CEO and President, Markle Foundation) announced the Markle Rework America initiative: "A 21st Century Digital Labor Market for Middle-Skill Job Seekers", designed to boost the signaling and improve the matching among employers, workers and educators. The initiative partners include LinkedIn, Arizona State university and edX, as well as regional partners in Colorado and Phoenix (the regions where the program is initially being rolled out). Reid wrote an interesting critique of higher education, Disrupting the Diploma, a few years ago, highlighting the need to "make certification faster, cheaper, and more effective". Zoe suggested that we need to create boot camps for other kinds of training to support other parts of the market beyond the technology sector, and explore new methods of credentialing beyond the traditional degrees granted by colleges and universities (which collectively make up the third largest lobbying group in Washington DC).

Exponential teaching

Kimberly Bryant (Founder, Black Girls CODE) championed exponential teaching: "If you teach one girl, she will naturally turn around and teach five, six, or 10 more”. Teaching black girls to code is a promising effort to counteract the effects of 45% of black women aged 25 and over having no high school diploma. The grass-roots organization has created 10 chapters in 4 years, and she invoked the optimism of Grace Lee Boggs with respect to the program's prospects: "I believe we are at the point now, in the US, where a movement is starting to emerge".

Matching workers with opportunities at high velocity

Stephane Kasriel(CEO, Upwork) talked about how UpWork ("Tinder for work") matches freelance knowledge workers (primarily software developers) to remote work opportunities, shortening the typical job search from 3-4 weeks to 1-2 days. With the steadily declining half-life of any skill (especially in the technology sector), Stephane declared "the resume is dead", and "all we want to do is reduce all the time people waste writing long form job descriptions and long form job proposals". To match workers with work, Upwork utilizes three different machine learning models to determine

Who is qualified?

Who is interested?

Who is available?

Upwork has 150K work descriptions and 250K worker profiles, with 5K workers signing up every day. Stephane said only about 2% of new workers get jobs right away, and one of the challenges for Upwork ("the celebrity agent of the freelancers") is to effectively manage talent at different stages of their pipeline (newcomers, rising stars and established workers). Stephane suggested that industry is not doing a good job of communicating data about needed skills back to academia. Having looped in and out of academia a few times myself, I would suggest that academia is not configured in a way that facilitates rapid response to changing educational needs, and so other learning channels will likely be needed to support the continuous cycle of nano-jobs, nano-skills and nano-degrees in the future.

Work rules: Lessons from Google's success

Laszlo Bock (Senior Vice President of People Operations, Google) said an internal study revealed there is little predictive value in determining the probability of success based on which school a candidate attended; the most predictive value was found in a sample work test, in which a candidate performs the type of work associated with the job function, and the second most predictive value was in cognitive ability, which can be assessed via structured interview questions (give me an example of a time when you did X). Google does not look only for superstars, since many superstars don't perform as well when they switch companies, but also looks for team players who improve the performance of everyone around them (like basketball player Shane Battier). Among their efforts to promote diversity, they have implemented an unconscious bias training program, and a Google in Residence program in which Google engineers are embedded in a handful of historically black colleges and universities where they advise on curriculum matters and mentor students. Google also conducts an anonymous survey of 8 management attributes to provide specific feedback (with no penalties) to managers; they have found that average favorability ratings increase every cycle, and that a 2-hour management program can help managers improve by 6-7 points.

Intelligent agents, augmented reality, and the future of productivity

Satya Nadella (CEO, Microsoft) posited the agent as the third runtime model (after the PC operating system and the browser), and talked about some of Microsoft's work in speech recognition, augmented reality and machine learning. He described augmentation as a "race with the machine", rather than a race against the machine (which may be a more apt description of automation).

Augmented reality in the factory

Brian Mullins (Founder and CEO, DAQRI) asked "What if you could put on a helmet and do any job?" and proceeded to present a number of applications of their augmented reality Smart Helmet: digitizing analog devices (e.g., gauges), providing thermal vision and improving "cognitive literacy". He went into some detail - including a video - on one deployment in partnership with Hyperloop using the helmet in a steel mill. I can't find that video, but found another video from EPRI that provides a better sense of how the Smart Helmet works.

How augmented workers grow the market

David Plouffe (Chief Advisor and Member of the Board, Uber) posed what he calls the central government question: How do we get more income to more people? He said asking how Uber is affecting the taxi market is the wrong question; instead, we should be looking at how Uber is affecting a multi-modal ecosystem, noting that fewer millennials are choosing to own cars and expanding transportation options can be crucial in helping people escape poverty. Uber has 400K drivers, but 100K drive only a few times a month and 50% of drivers drive < 10 hours / week. During the Q&A session, Eric Barajas, the Uber driver who had appeared on the previous day's panel, asked about what Uber can do to better support drivers who are driving full-time, and was invited to come talk to the Uber SF office about it (I hope he doesn't suffer any adverse consequences from speaking up).

Reinventing healthcare

Lynda Chin (Director, Institute for Health Transformation) talked about the Oncology Expert Adviser, a healthcare application based on IBM Watson. As is so often the case when I read about Watson in healthcare, I love the idea of a system that can take in all kinds of input - text analysis of articles from the medical literature as well as individual patient charts, diagnoses of past cases by human experts - and assist doctors in diagnosis and treatment. Unfortunately, as is also so often the case when I hear or read about Watson in healthcare, I don't get a clear idea of what it can actually do yet.

Policy action recommendations for the 21st century economy

In this panel discussion, Felicia Wong (President and CEO, Roosevelt Institute) championed campaign finance reform, reversing the financialization of the economy and making massive investment in human capital; Neera Tanden (President, Center for American Progress) noted that the US is relatively unique among leading industrial countries in the downward pressure on wages and pointed toward Australia and Canada as better models for achieving median income growth through higher rates of unionization (30% vs. 6%), more equitable education (higher education is [nearly] free) and relatively smaller and more regulated financial sectors; Zoë Baird (CEO and President, Markle Foundation) recommended the adoption of policies that will help SMBs better reach global markets.

Rewiring the US labor market

Byron Auguste (Managing Director, Opportunity@Work) claims that "talent is far more evenly distributed than opportunity or money" and that the labor market is "a wildly inefficient 'efficiency' market", pointing to credential creep (e.g., only 20% of current administrative assistants have bachelor degrees and yet 65% of administrative assistant job descriptions require them), Okun's Law (the correlation between increased unemployment and reduced GDP), a quit rate that is down 28% since 2010 and a record number (5.8M) of unfilled jobs. The White House TechHire initiative includes a national employer network and an open platform to provided better training for and access to information technology jobs in 31 cities for some of the segments of the US population that are not being well served by the current labor market:

Reinventing the labor union

Liz Shuler(Secretary-Treasurer / CFO, AFL-CIO) talked about some of the challenges facing unions ("the original disrupters" of the workplace) and unionization efforts. Andy Stern(Senior Fellow, Columbia University; former President, SEIU) talked about the strategic inflection point we are approaching with respect to automation's potential impact on work and the long-standing connection between work and income. He suggested that now is an ideal time to consider universal basic income, which guarantees everyone a basic level of income by having government give money directly to those in poverty, rather than via special programs such as food stamps and earned income tax credits that are burdensome for everyone involved. "If you want to end poverty give people money".

Reinventing public transportation

Logan Green(CEO, Lyft) talked about some of the ways that Lyft is trying to support its drivers. Although 78% of Lyft drivers drive < 15 hours / week, they offer a power driver bonus, giving increasing amounts of commission back as drivers drive more. The Lyft app offers passengers the option to include a tip, though Tim O'Reilly (who was interviewing Logan) said that a Lyft driver told him that only 20% of passengers leave a tip. Toward the end of the conversation, Logan noted that the least profitable runs in public transportation are the most expensive, and that some kind of public/private partnership might enable Lyft to complement public transportation.

A people-centered economy

Chad Dickerson(CEO, Etsy) talked about how Etsy embraces the idea that small is beautiful. In addition to enabling individual artisans to sell their creations, Etsy is reimagining manufacturing, allowing Etsy users to register as manufacturers if they want to work with other Etsy users to help create their products. There are also self-organized teams of Etsy sellers around the world, and he gave an example where Italian sellers were encouraging prospective buyers to buy things produced from Greek sellers during the Greece financial crisis. He also said that Etsy has become a Public Benefits Corporation.

The good jobs strategy

Zeynep Ton(Associate Professor, MIT Sloan School of Management) presented her research into the financial success enjoyed by companies that embrace human-centered systems and provide jobs with meaning and dignity, offering the following principles: operate with some slack (not too lean), offer less (fewer products), cross train, standardize and empower. Dan Teran (co-founder, Managed by Q) said he recognized early on that "if we wanted to have the best employees, we had to be the best employer"; engineers at the company go out and clean an office the first week, so they can better understand the tasks and environment in which the cleaners who work for the company operate. Palak Shah (Social Innovations Director, National Domestic Workers Alliance) noted that "in a way you can consider domestic workers [nannies, caregivers, cleaners] as the original gig workers" and presented the Good Work Code, "an overarching framework of 8 simple values that are the foundation of good work".

Enable people, and they will amaze you

Evan Williams(CEO, The Obvious Corporation, and founder of Medium and Blogger), whose first tech job was with O'Reilly Media, said the thing that got him excited about the Internet was the idea of knowledge exchange. One of the motivations behind Medium was that comments on blogs are not on the same level as the posts; on Medium, replies are posts, and so all commentary is on the same level. Noting that "what you measure gets rewarded", Medium measures time on a page, not [just] page views or unique visitors. In the Q&A session, someone asked "how do you think about the future". Ev replied "I just listen to Tim" ... and then Tim replied "I look for people who are passionate about what they do".

The conference sessions offered a compelling collection of people who are passionate about what they do, and much of what many of the speakers do is helping other people find ways to exercise their passions in what they do ... and a recursive promulgation of passion seems to be as good a note as any on which to end this post.